How to Buy Microsoft Stock – Price, Prediction and Dividend
There are plenty of good reasons to include Microsoft stock in your portfolio. It is a diversified technology behemoth that combines some of the most exciting growth and value stocks strengths. Some of its historical businesses are near-monopolies, while others focus on forward-looking technologies that will ensure its long-term development.
In this analysis, we will therefore study the historical evolution of the Microsoft stock, and various arguments that show that the Microsoft stock price should progress. We will also introduce you to an online broker that we consider ideal for buying Microsoft stock.
Microsoft, one of the world's best-known tech brands, has built its reputation around the Windows operating system and its Office suite, which includes the famous Word and Excel. But Microsoft doesn’t settle with simply dominating the computer operating system market. Indeed, it is today a conglomerate diversified in many activities. Founded by the famous Bill Gates, the company is now headed by Satya Nadella, who succeeded Steve Balmer. It employs 148,000 people in 120 countries. Its turnover added up to more than 61 billion dollars in the year 2021.
In addition to operating systems and software, the company also has activities in video games, primarily through its Xbox consoles. Microsoft is also a significant player in the cloud, a revenue stream that has grown faster at Microsoft in Q2 than at market leader Amazon. It is also an Internet company, operating leading sites such as the search engine Bing or the professional social network LinkedIn and the e-mail service outlook.com.
The stock Microsoft can also be considered a bet on virtual and augmented reality technologies. Although the company is not currently developing any consumer products in this area, it is working on this topic with the US Army and companies such as Lockheed Martin. We'll go into more detail about the highlights of Microsoft's activities and their prospects later in this guide. But before that, we'll take a look at Microsoft's stock profile and the historical price trend in the next section.
Microsoft Stock Price History
Microsoft stocks are listed in the United States on the NASDAQ exchange. Microsoft's stock symbol is MSFT, and its ISIN code is US5949181045.
Most of the US stock market indexes include Microsoft stock in their components. Microsoft stocks are therefore included in the Nasdaq, the S&P 500, the Dow Jones and many others.
Microsoft stock is up more than 46% over 52 weeks, after bottoming at $196 and peaking at $305 during that period. Its market capitalization is $2230 billion, making it one of the largest companies in the world in terms of capitalization. As it is for splits, the most recent Microsoft stock split was a 2-for-1 common stock split announced on January 16, 2003. This was the ninth Microsoft stock split since the IPO.
Historical Evolution of the Microsoft Stock Quote
Let's now take a look at the long-term evolution of the Microsoft stock price. From its introduction on the stock exchange in the mid-80s, until the Internet crisis of the 2000s, Microsoft stock price has shown a clear upward trend, as can be seen on the Microsoft stock chart below (monthly):
The stock then began a slightly bearish consolidation that lasted about 13 years, before the stock Microsoft initiated a new long-term uptrend in which we are still engaged.
At the beginning of the current uptrend in 2014, Microsoft stock was worth about $35. Knowing that in September 2021 it marked a new all-time high at $305, Microsoft stock quote has risen more than 770% in 7 years, making it one of the best performing technology stocks in the market. We'll look at the shorter-term chart context for the stock Microsoft later in this guide, when we discuss the Microsoft technical forecast.
Why Invest in Microsoft Stock? Points to consider
As suggested above, there are many good reasons to buy Microsoft stock. In particular, its business and development prospects give reason for optimism. In this section, we will therefore discuss the main fundamental strengths of Microsoft stock.
An Unbridgeable Competitive Gap in OS and Software
Microsoft's dominance in terms of operating systems and office software is an almost monopoly. Most of the world's computers run on its Windows OS, and millions, if not billions, of students and workers worldwide use its software, including Excel, Word, and Powerpoint.
Of course, there are alternatives, some of which of very high quality. However, Windows operating systems and software are installed by default on the vast majority of computers sold to the general public. This thus makes it almost impossible for most to compete with Microsoft in its core business.
Microsoft Stock is a Bet on AR/VR Technologies
As it stands, Microsoft does not currently plan to develop virtual or augmented reality products for the general public. However, it recently signed a $22 billion contract with the U.S. military for augmented reality headsets.
In addition, several companies, including Lockheed Martin, have already used its "mixed reality" headset HoloLens 2 to assist engineers with complex tasks. This makes the Microsoft stock an ideal buy to complement other more consumer-oriented AR/VR stocks.
A Major Player in the Juicy Cloud Computing Market
Amazon AWS currently dominates the cloud services business - but Microsoft, with Azure, is also in a very good position to continue to benefit from the growth of this high-margin market.
In fact, revenues from this Microsoft division grew 51% in the most recent quarterly release, while Amazon AWS revenues grew only 37% over the same period. This suggests that Microsoft is taking market stock from Amazon in the cloud, and could eventually become the market leader.
The Microsoft Stock Dividend is Steadily Growing
With a yield of less than 1% per year currently, the Microsoft stock dividend doesn't really qualify the stock as a revenue stock. However, long-term investors will appreciate the fact that Microsoft's dividend has increased for the past 19 consecutive years.
Over the last 5 years alone, Microsoft's dividend has increased by an average of 9.5% per year. And there is every reason to believe that this dividend will continue to increase, given that it currently consumes only 29% of cash flow.
Microsoft Stock Forecast and Prediction
Now that we've established that Microsoft's business is strong and has a bright future ahead of it, we'll look at more technical factors below, such as Microsoft's financial performance, the technical profile of Microsoft's stock price chart, as well as professional analyst forecasts.
Microsoft Stock Forecast: Financials
Microsoft stock has an almost flawless track record of beating analysts' targets, both in terms of revenue and earnings. Most notably, it has exceeded economists' EPS estimates for the past 21 consecutive quarters!
The latest Q2 2021 quarterly results once again demonstrated this ability to outperform, with EPS of $2.17, versus $1.92 expected, and revenue of $46.15 billion, versus $44.22 billion expected.
For the next quarter, the consensus is for EPS of $2.06, up 13% year-over-year, and sales of $43.72 billion, up nearly 26% from the same quarter a year ago, knowing that there is a statistically very high chance that these forecasts will be greatly exceeded.
Microsoft Stock Forecast: Technical Background
From the weekly Microsoft stock chart, we can see that the stock is in a positive trend, highlighted by a visible uptrend line since August 2015.
It is interesting to note that since that date, Microsoft stock has only known 2 periods of decline, the last of which was triggered by the covid-19 pandemic, whose bearish impact was then quickly erased. And neither correction was deep enough to challenge the long-term uptrend.
Microsoft Stock Forecast of Analysts
According to TipRanks, there are currently 22 professional analysts are providing Microsoft stock Forecast. All of them recommend buying the stock. Such a consensus is rare, especially for a stock followed by so many analysts.
The average target price of Microsoft stocks is $331, which implies a potential upside of 11.5% compared to the current price. However, note that some are more optimistic than others. For example, at $411 per Microsoft stock, the highest forecast implies a potential upside of almost 40% from the current price.
Where Can I Buy Microsoft Stock?
There are many brokers in the market, but some are better than others. In the course of our research, we discovered that ZFX is one of the brokers that displays the most significant advantages.
Established in 2018, this broker is relatively new, but that doesn't take away from its qualities. Speaking about security and regulation, ZFX is holds licences by several financial authorities, including the UK FCA.
As far as the trading platform is concerned, ZFX offers the famous MT4 platform, which millions of traders worldwide use. This platform offers all the essential tools for traders. It is also one of the best platform for automatic trading. Finally, as far as accessible markets are concerned, ZFX offers to buy stocks, commodities, indices, and forex currency pairs.
How to Buy Microsoft Stock Easily
Buying Microsoft shares through the broker ZFX is very simple and fast. Indeed, the account opening is done entirely online, and takes only a few minutes. All you have to do is follow these steps:
- Register with ZFX
- Verify your ZFX account
- Make your first deposit
- Buy Microsoft stock
Let's go through each of these steps in detail.
1 - Register with ZFX
For this first step, you will need to go to the ZFX broker's website, and click on the "open an account" button. You will then have to fill in a registration form with several personal details, including your phone number, which will be verified by SMS.
After filling out the form, click on the "next" button at the bottom of the page.
Immediately after this step, ZFX will display your MT4 login and password, and invite you to download the platform.
2 - Make your first deposit
To do this, you will need to click on the "make a deposit" button on the screen displayed immediately after registration. You will then need to choose a payment method. Let's take Mastercard as an example:
On this screen you will need to indicate the deposit amount. Then, click on the "Confirm Deposit" button. Then, provide your credit card information before the final validation of the payment.
3 - Account verification
Finally, it will also be necessary to proceed with the account verification by sending supporting documents.
As shown in the image above, you will need to upload the documents directly to the ZFX website. Once ZFX validates your documents, you will then be ready to buy Microsoft stock.
4 - Buy Microsoft stock
After completing all the steps above, click the “Download MT4” button at the top (as shown in the image above) and install it to your computer. Subsequently, log in using the details you saved earlier. You can now proceed with investing in Microsoft stock, through MT4 platform offered by ZFX. You can find the share under the symbol “MSFT”.
Bottom Line : Should you Buy Microsoft Stock?
The bullish potential of Microsoft stock is based on its dominance in operating systems and software, which secures most of its revenue. But Microsoft has also invested in many other businesses. Indeed, it is a major player in many areas, such as video games and cloud computing... Thus, its revenue streams that will grow exponentially over the next few years.
In addition, Microsoft has a near-perfect track record of financial performance. It has exceeded expectations in almost every quarter since the company's IPO. Furthermore, a study of Microsoft stock chart reveals a strong long-term uptrend that has never shown any signs of weakening. This justifies the fact that all the analysts who follow the stock recommend buying it.
If you too would like to add MSFT stock to your portfolio without further delay, we strongly recommend that you check out the broker ZFX. This is a trustworthy intermediary for buying Microsoft shares and many others.